Abbott(ABT) - 2024 Q1 - Quarterly Report

Sales Performance - Total net sales increased by 5.1% excluding foreign exchange impact, driven by growth in Medical Devices and Established Pharmaceuticals, partially offset by a decline in COVID-19 testing sales[90] - COVID-19 testing-related sales totaled $204 million in Q1 2024, down from$ 730 million in Q1 2023[90] - Medical Devices sales increased by 15.4% excluding foreign exchange, led by double-digit growth in Diabetes Care, Electrophysiology, Vascular, Structural Heart, and Neuromodulation[98] - FreeStyle Libre sales reached $1.5 billion in Q1 2024, a 23.3% increase excluding foreign exchange[98] - Diagnostic Products sales decreased by 15.5% excluding foreign exchange, primarily due to lower demand for COVID-19 tests[96] - Rapid Diagnostics sales declined by 38.7% excluding foreign exchange, driven by reduced COVID-19 testing demand[96] - Nutritional Products sales increased by 7.7% excluding foreign exchange, with U.S. Pediatric Nutritionals up 12.0%[96] - Core Laboratory Diagnostics sales grew by 5.9% excluding foreign exchange, supported by the Alinity testing platform[97] Expenses and Investments - R&D expenses increased by$ 30 million (4.5%) in Q1 2024 compared to the prior year[100] - SG&A expenses increased by $197 million (7.1%) in Q1 2024, driven by higher spending to support business growth[101] - Abbott completed the acquisition of CSI for$ 851 million, adding complementary technologies to its vascular device offerings[113] - The final allocation of the CSI acquisition included $305 million in non-deductible developed technology intangible assets and$ 369 million in non-deductible goodwill[114] Financial Position and Cash Flow - Abbott's cash and cash equivalents decreased from $6.9 billion at December 31, 2023 to$ 6.3 billion at March 31, 2024, primarily due to dividend payments and capital expenditures[109] - Net cash from operating activities for the first three months of 2024 totaled approximately $1.0 billion, a decrease of$ 118 million from the prior year[110] - Abbott's working capital decreased from $8.8 billion at December 31, 2023 to$ 8.4 billion at March 31, 2024, primarily due to a decrease in cash and cash equivalents and an increase in the current portion of long-term debt[109] - Abbott declared a quarterly dividend of $0.55 per share in Q1 2024, representing a 7.8% increase over the$ 0.51 per share dividend declared in Q1 2023[111] - Abbott has unused lines of credit that provide the ability to borrow up to $5 billion on an unsecured basis[111] Tax and Regulatory Matters - Abbott received a Statutory Notice of Deficiency (SNOD) from the IRS for the 2019 Federal tax year in the amount of$ 417 million, primarily related to income reallocation between U.S. entities and foreign affiliates[106] - The OECD's Pillar 2 proposal, which includes a 15% minimum tax on multinational corporations' earnings, may have a material impact on Abbott's financial statements in the future[108] Credit Ratings - Abbott's long-term debt rating was AA- by S&P Global Ratings and Aa3 by Moody's Investors Service as of March 31, 2024[110]